SHENZHEN-BASED gaming and social media company Tencent Holdings Ltd. will cut its stake in Singapore-based gaming and e-commerce firm Sea Ltd., reducing its voting power to under 10 percent.

According to a term sheet, Tencent is selling at a price range of US$208-US$212 per share, bringing the total divestment to up to US$3.1 billion.

Sea’s U.S.-listed shares’ last close price was US$223.31 per share. The trade has not been priced, according to a person with direct knowledge.

Tencent will divest about 14.5 million shares, reducing its stake to 18.7 percent from 21.3 percent. The company said it intends to retain the substantial majority of its stake in Sea for the long term.

“The share sale unlocks a portion of the value of Tencent’s investment in Sea, which has seen significant growth and expansion in its global business operations. The divestment provides Tencent with resources to fund other investments and social initiatives,” the company said in a statement.

Tencent will be subject to a lockup period that restricts further sale of Sea shares during the next six months.

Goldman Sachs, Morgan Stanley and Bank of America advised on the trade, according to the term sheet.

Tencent’s move comes just days after the company said it would divest US$16.4 billion of its stake in JD.com, weakening its ties to the e-commerce firm.

Sea said Tencent and its affiliates had given an irrevocable notice to convert all their Class B ordinary shares. (SD-Agencies)